Intelligence Report from 2012 on the AGM and shareholder engagement

1. Intelligence
Report
> The AGM and shareholder engagement
November 2012
certainty ingenuity advantage COMMERCIAL IN CONFIDENCE

2. Introduction
In December 2011 the Government requested that the Corporations and Markets Advisory Committee (CAMAC) undertake a review into the future
of the Annual General Meeting (AGM). CAMAC subsequently released a discussion paper on 14 September 2012, outlining the four broad areas
under consideration:
1. Shareholder engagement
2. Annual reports
3. Conducting the AGM
4. The future and format of the AGM
Throughout September and October 2012 Computershare surveyed over 2,300 shareholders via its online portal, Investor Centre. This survey set
out to understand the opinions of retail shareholders in relation to the AGM and also understand more about their communication preferences.
About the survey respondents
• 71% of respondents said that they were over the age of 51, 20% between 36 and 50, and 9% said that they were 35 or younger.
• 93.5% of respondents said that they were a personal investor. 6.5% of respondents told us that they were not a personal investor, however
of this group three quarters said that their shareholding formed part of their Self Managed Superannuation Fund (SMSF), followed by 7%
who identified themselves as employee shareholders.
• Aside from being referred to as ‘respondents’ in this report, survey participants are also titled ‘retail shareholders’ or ‘shareholders’.
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3. Being “a small shareholder with little influence” and “distance” are Shareholders who turn up
to meetings indicate that
the most common reasons for 78% of shareholders saying that they they do so to engage with
never attend AGMs. the board:
57% say that the AGM
Do you attend Annual General Meetings for the companies in which you own shares? allows them to assess
a board’s capability in
2% governing a company.
20% 23% say that they attend to
ask questions of directors
I always attend the meetings
in a public forum.
I occasionally attend meetings “I like to hear what the
78% directors say about the
Company’s plans going
I never attend meetings
forward.”
“After the meeting I get
most value if the senior
officers of the company
Despite 22% of shareholders in this survey saying that they always or occasionally attend make themselves available
meetings, Computershare data shows that very few actually turn up. Average shareholder for one-to-one discussion.”
attendance at meetings for 2012 to date is less than 0.2%*.
* Based on Computershare clients
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4. Shareholders are evenly divided about how much time they need to
review AGM documentation.
How much time do you need to review AGM documentation before voting?
22% 20%
78% of respondents want
to receive their AGM
< 5 days documentation via a
digital channel, however
5-10 days Computershare data
shows that less than a
21% 11-20 days quarter of shareholders
21% actually receive this
information online.
21-28 days
I don’t review these materials or vote
16%
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5. Nearly half the respondents who say they won’t vote this year cite
their small holding not making a difference as the reason.
68% of shareholders say
that they will vote this year.
Historically these good
What is your reason for not voting?
intentions haven’t always
5% translated to an actual
11%
I’m not interested vote, with under 7%* of
5% shareholders voting in 2011.
No time or other more important commitments
25%
My small holding would not make any difference “[My vote] would make no
difference and generally
I’m unsure of the voting process, it’s all too complex happy with Board of
Management.”
5%
I’m generally happy with the direction of the
company, and have confidence in the decisions
made by the board and management “I am generally happy
with the direction of the
49% Other
company and if I become
unhappy I will sell out.”
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6. 38% of shareholders who are not planning to vote this year said that
they would be more likely to vote if they could do so until sometime
after the AGM, thereby allowing them more time to consider the
meeting’s proceedings before casting their vote.
In this situation would you be more likely to vote?
Of the shareholders
38% planning to vote this year,
63% thought that allowing
shareholders more time to
37% Yes vote after the AGM would
be a positive change.
No, I would still not vote
Undecided
25%
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7. Retail shareholders are adept with technology and open to being
engaged via digital channels. 66% of respondents say that they would
participate in an online AGM if it was offered. 73% of shareholders said
that they would prefer to
‘go paperless’ and vote
A virtual Annual General Meeting allows you to attend, ask questions and vote at the meeting
online.
completely online. If companies held online Annual General Meetings, would you:
4% 10% 75% of respondents
indicated that they
Always attend and participate in online were interested in being
meetings if they were available provided with voting
24% results following an AGM.
Occasionally attend and participate in online meetings
Continue to only attend meetings in person Nearly three quarters of
6% respondents said that they
Continue to never attend meetings would like the results to
be communicated to them
Other (please specify) via a digital channel (email,
digital mailbox or SMS).
56%
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8. Retail shareholders use a variety of online sources to keep up to
date with news about companies in which they own shares. Where do retail
shareholders most
Aside from the annual report, how do you mostly source information about the company? frequently go to source
information about the
The company's website 11% 69% 20% company?
1%
The company's Facebook page 95% 4%
1% 89% visit the company’s
The company's Twitter feed 97% 2% website.
1%
The company's blog/RSS feed 93% 6%
1% 82% visit free to access
The company's Youtube channel 95% 4%
news or industry
Other news or industry commentator commentator sites.
18% 45% 37%
websites, blogs (free to access content)
Other news or industry commentator
50% 28% 22%
websites, blogs (pay to access content) 50% pay to access content
0 20 40 60 80 100 from news or industry
Not at all Occasionally Frequently commentator sites.
While only a small proportion of respondents indicated that they check out a company’s
Facebook, Twitter, YouTube channel or blog to find information, retail shareholders have strong
connections with social media – 78% use webinars and internet audio/video (for example,
Skype), 35% use Facebook and 20% use YouTube.
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9. ! For more information about the information contained in this Intelligence Report, please speak with
your relationship manager or contact us here
About Computershare Limited
Computershare (ASX:CPU) is a global market leader in transfer agency and share registration, employee equity plans, proxy solicitation and stakeholder
communications. We also specialise in corporate trust, mortgage, bankruptcy, class action, utility and tax voucher administration, and a range of other
diversified financial and governance services.
Founded in 1978, Computershare is renowned for its expertise in high integrity data management, high volume transaction processing and reconciliations,
payments and stakeholder engagement. Many of the world’s leading organisations use us to streamline and maximise the value of relationships with their
investors, employees, creditors and customers.
Computershare is represented in all major financial markets and has over 12,000 employees worldwide.
©2012 Computershare Investor Services Pty Limited. Computershare and the Computershare logo are registered trademarks of Computershare Limited. All other products and services named are trademarks of their
respective owners.
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